EXPLANATORY STATEMENT
Tariff Concession Instrument No. 0619742
Customs Act 1901
Background
Part XVA of the Customs Act 1901 (the Act) sets out a scheme under which Tariff Concession Orders (TCOs) may be made by the Chief Executive Officer of Customs (the CEO). A lower rate of customs duty applies to goods that are the subject of a TCO.
Under section 269F of the Act, a person may apply to the CEO for a TCO in respect of goods. If the CEO is satisfied that the application is not in respect of goods specified in section 269SJ of the Act, which sets out those goods that cannot be subject to a TCO, the CEO must decide whether the application meets the core criteria.
Section 269C of the Act provides that a TCO application meets the core criteria if, on the day on which the application was lodged, no substitutable goods were produced in Australia in the ordinary course of business. Section 269B of the Act provides that ‘goods produced in Australia’ has the meaning given by section 269D, ‘ordinary course of business’ has the meaning given by section 269E and ‘substitutable goods’ in respect of goods the subject of a TCO application, means goods produced in Australia that are put, or are capable of being put, to a use that corresponds with a use (including a design use) to which the goods the subject of the application can be put.
Subsection 269P(3) of the Act provides that if the CEO is satisfied that a TCO application meets the core criteria, the CEO must make a written order (a TCO) declaring that the goods the subject of the TCO application are goods to which a prescribed item of Schedule 4 to the Customs Tariff Act 1995 (the Tariff) specified in the order applies.
Bluescope Steel Ltd applied for a TCO in respect of certain refractory bricks and/or shapes on 12 December 2006.
Instrument
TCO No 0619742 was made on 9 March 2007. It declares that those certain refractory bricks and/or shapes are goods to which item 50 of Schedule 4 to the Tariff applies since the CEO was satisfied that no substitutable goods were produced in Australia. The general rate of duty on these goods is 5%. The rate of duty for the goods subject to the TCO is 0%.
Consultation
Subsection 269K(1) of the Act provides in part that as soon as practicable after accepting a TCO application as a valid application, the CEO must publish a notice in the Gazette which includes an invitation to any person who considers that there are reasons why the TCO should not be made to lodge a submission with the CEO. The CEO did not receive any submissions in response to this invitation.
Commencement
Subsection 269S(1) relevantly provides that a TCO is to be taken to have come into force on the day on which the application for the TCO was lodged. TCO No. 0619742 is taken to have come into force on 12 December 2006.
The TCO does not affect the rights of a person (other than the Commonwealth) as at the date of registration so as to disadvantage that person or impose liabilities on a person (other than the Commonwealth) in respect of anything done or omitted to be done before the date of registration. The rights of importers will be beneficially affected. Under paragraph 126(1)(r) of the Regulations, importers of such goods will be able to apply for a refund of duty on goods imported since the day on which the TCO is taken to have come into force. The TCO does not impose any liabilities on any person.
Overview
The Tariff Concession Instrument No. 0619742, enacted under the Customs Act 1901, was introduced to address the issue of facilitating the importation of specific goods by providing tariff concessions. This legislation allows for a reduction in customs duty on certain goods, provided they meet specific criteria outlined in the Act. The policy objective is to ensure that the goods subject to the tariff concession are not produced in Australia and thus do not have substitutable products available domestically. The instrument was created in response to an application from Bluescope Steel Ltd for tariff concessions on certain refractory bricks and shapes, aiming to benefit importers by potentially reducing their duty liabilities and enhancing the competitiveness of these goods in the Australian market. The instrument was enacted by the Chief Executive Officer of Customs, following consultation and without any adverse submissions, and it came into force on the date the application was lodged.
Scope and Application
The Tariff Concession Instrument No. 0619742 under the Customs Act 1901 applies to the specific goods, namely certain refractory bricks and/or shapes, which were the subject of an application made by Bluescope Steel Ltd on 12 December 2006. The Act allows for the Chief Executive Officer of Customs to make Tariff Concession Orders (TCOs) that lower the customs duty on specified goods if certain criteria are met. The TCO was issued on 9 March 2007, reducing the duty on these goods from the general rate of 5% to 0%, based on the determination that no substitutable goods were produced in Australia at the time of the application. The Act applies across the Commonwealth of Australia and involves the processing and reduction of customs duty on imported goods that meet the specified criteria. The scope of the Act does not include goods listed in section 269SJ of the Act, which cannot be subject to a TCO. The application of this Act can be further detailed or modified through subordinate instruments, but in this instance, the primary legislation itself outlines the key parameters and requirements for issuing TCOs.
Key Provisions
The main provisions of Tariff Concession Instrument No. 0619742, made under the Customs Act 1901 (the Act), concern the application and granting of Tariff Concession Orders (TCOs) for certain refractory bricks and shapes. Section 269F of the Act allows a person to apply to the Chief Executive Officer (CEO) of Customs for a TCO in respect of goods, provided the goods are not specified in section 269SJ, which lists those that cannot be subject to a TCO. The CEO must decide if the application meets the core criteria outlined in section 269C, which requires that no substitutable goods were produced in Australia on the day the application was lodged. Once the CEO is satisfied the application meets these criteria, a TCO is issued, as specified in section 269P(3), reducing the customs duty rate on the specified goods.
The Act imposes several obligations on parties involved with TCOs. Firstly, applicants must ensure their goods are not excluded under section 269SJ and that the application meets the core criteria. The CEO is obligated to assess applications against these criteria and publish a notice in the Gazette inviting submissions from interested parties, as per section 269K(1). The CEO must also ensure that any TCOs issued comply with the provisions of the Act and do not impose liabilities on any person other than the Commonwealth, as per section 269S(1). This ensures that the rights of existing importers are not adversely affected by the TCO.
The Customs Act 1901 does not explicitly outline specific offences, penalties, or consequences for breaches of the TCO provisions. However, general provisions within the Act and related legislation may apply to breaches of customs regulations, including potential penalties for non-compliance. For example, section 271 of the Act provides for penalties for false statements or documents related to customs and excise matters, and section 283A allows for penalties for breaches of the Customs Act and related Acts. These penalties can include fines and imprisonment, with the exact penalties dependent on the nature and severity of the breach. Additionally, any failure to comply with the terms of a TCO could result in civil consequences, such as the imposition of duties or other financial penalties.